NELSON BILL on H1B - DRAFT OF THIS WIND PROMISES A STORM

By Ruma Dubey

Two years ago, there was a similar call by some Senators of USA – demanding drastic changes in the H1B visa norms, which would have hit the Indian IT industry hard.

At that time, the Draft Bill had proposed that if an employer has 50 or more employees, and more than 30% but less than 50% are H-1B or L-1 employees, the employer will need to pay $5000 as fee for each additional worker, be it H1-B or L1. In the same category, it a company has 50 or more employees and more than 50% are on H1-B or L1 visas, the fee is $10,000 per worker. This automatically means that the Tier I IT companies – TCS, Wipro, Infosys will fall into the higher category - $10,000 per additional worker while those based in USA, like Microsoft or Intel or Cisco will have no such restrictions.  The Bill, on the other hand had proposed to increase the H1B visa quota from 65,000 to 1,10,000 and then adding 5000 more, taking it up eventually to 1,80,000.

This Draft Bill remained just that – a draft; was never legislated. And now there is another new Bill – known as the Nelson Bill which has started making news. Once again, the Bill, as expected and to be fair to their country, is pro-American; it wants to protect the jobs of their skilled IT professionals and bring in lesser Indian IT professionals. The way the Bill is worded, though not spelt out directly, it does indicate that the target is Indian IT companies. In fact New York Times recently reported that 13 outsourcing companies took nearly one-third of the annual 85,000 H-1B visa allotment in 2014.

The gist of the Bill:

• Reduce the number of foreign worker visas -- H-1B visas, by  15,000 – from the current 65,000 to 50,000.
• Bill seeks to prohibit companies from hiring H-1B employees if they employ more than 50 people in the US and more than 50% of those employees are H-1B and L-1 visa holders.
• To reintroduce “best and brightest” clause, something which was proposed way back in the 1960s. This is known as the priority allocation method wherein companies should rather hire Indian students pursuing STEM graduate degrees over H1B Indian IT workers. This is mainly to make the US colleges even more attractive – in 2014 international students contributed $31 billion to the US economy.
• What could also make a return is the special $2,000 (Rs "‹1.34 lakh) fee on H1B and L1 visas for Indian IT  companies; money to be used to fund a 9/11 healthcare act in the US.
• This extra fee of $2000 applies to companies with at least 50% of their employees on H1B visa or L1 visas, and is in addition to the other fees paid by employers.

Once again, these are proposals and should be viewed in the light of the other rhetoric’s being voiced on account of the 2016 Presidential elections.  There too, like here, it takes a while to legislate a Bill. So maybe we are pressing the panic button. But the underlying thought here is that this is something which might not happen now but could become a reality next year. The fact that there is a growing feeling that Indian IT companies are misusing the H1B law to bring in cheap labour and depriving Americans of their jobs is something which could only grow as the economy picks up steam.

All this is being done to protect America and American jobs. On principle grounds there is nothing wrong; if foreigners were taking away jobs in India, would we tolerate this? Within India itself, people from other states taking jobs of Maharashtra is not being tolerated so need we say more?  And this bill if it becomes a law, will surely hit Indian IT companies hard. But to try and give this a geopolitical color would be wrong – there is nothing retaliatory or revengeful here; this was very much in the offing and our Indian companies will have to deal with this change if and when it happens. Yes, India is today on the global map, thanks to IT and USA helping give Indian IT the world platform. Nasscom probably needs to strengthen its communication and urge IT companies to respect the law.

The world is our oyster and this is probably the time to explore the new world….